Once the company is able to improve results and costs are reduced, Hapag-Lloyd AG – Germany’s biggest container shipping line, will be a very attractive investment.
In April 2014, Hapag-Lloyd agreed to take over CSAV’s container shipping assets to create the world’s fourth-largest liner with about 200 vessels. The move is seen by analysts as a means of closing the gap on container shipping industry leaders, like MSC and Maersk Line.
After completing the CSAV takeover, Hapag-Lloyd was able to raise 370 million euros ($430 million) in December 2014, from two of its biggest shareholders. Billionaire Klaus-Michael Kuehne provided 111 million euros and CSAV another 259 million euros. The intention was mainly to allow the carrier to modernize its fleet. With this investment, the company has enough cash to order new vessels, probably in the second quarter of 2015.
To improve it's investment appeal, the company intends to “significantly” cut its operating costs by more than $100 million in 2015, mainly by improving inland cargo services, and by boosting vessel utilization. Lower fuel prices will also help cut operational expenses, but the effect will only be temporary.